Tomahawk, WI 07/18/2014 (Basicsmedia) – On CNBC’s Tech Connect, Clement Teo, a senior analyst at Forester, discussed Microsoft Corporation (NASDAQ:MSFT) and its plans for the future. Following the recent developments in Microsoft where the CEO Satya Nadella issued a detailed memo to employees and the company later announced a massive layoff, analysts are convinced that Nadella is a man on a serious mission to remake the company.
However, it appears as though layoffs are simply the start of remarking Microsoft because the company also needs to push more into mobile and software remains its key focus. In the discussion, Teo also provided insight into areas that are likely to be impacted by the layoff. He also believes that the massive layoff of 18,000 workers will likely be a one-off thing not a recurring series of layoffs in the company.
“He is a man on a mission. I think he is going to remake Microsoft in the shortest possible time. I expect that the layoff was already part of the plan when they bought Nokia, and it is a few days before the next quarter, so I think he wants to impress the market,” observed Teo.
That Microsoft Corporation (NASDAQ:MSFT) is trying to remake itself in the shortest period possible is something that is increasingly becoming obvious. Analysts like Teo are not surprised at all with the developments, especially with the job-cuts that are coming after the purchase of Nokia Corporation (ADR) (NYSE:NOK)’s handset business.
To Teo, Nadella will likely eliminate several jobs in the Nokia unit they acquired for about $7.4 billion. As for Nokia, the handset area is expected to take the most heat. He also thinks the layoffs will be focused on reducing jobs that replicate themselves within the company. Xbox entertainment is another division within Microsoft Corporation (NASDAQ:MSFT) that is likely to be impacted by the job elimination plan.
In all that Microsoft Corporation (NASDAQ:MSFT) is trying under Nadella, Teo sees it as efforts by the company to increase the foothold in mobile and software.
“MSFT is remaking itself to be applications focused company, software is its core, so devices are just a channel to that,” he said.